Saudi Ready To Boost Oil Output By 1.3 Million Bpd "immediately"

RIYADH, Aug 11 (AFP) - Saudi Arabia is ready to increase oil output by 1.3 million barrels per day (bpd) "immediately" to cope with world demand and curb soaring prices, Oil Minister Ali al-Nuaimi said Wednesday.
"The kingdom is well prepared to meet all the requirements of the international oil companies if they need additional volumes, relying on its surplus production capacity of more than 1.3 million barrels daily, which could be used immediately if required," he told the state news agency SPA.
The announcement by Saudi Arabia, OPEC heavyweight and the world`s leading producer, sent oil prices tumbling in London and New York.
Nuaimi stressed the determination of his country and the Organisation of Petroleum Exporting Countries (OPEC) to prevent soaring oil prices from damaging the world economy.
"Saudi Arabia, in collaboration with the other OPEC (Organisation of Petroleum Exporting Countries) endeavors to ensure the stability of the international oil market and prevent oil prices from escalating in a way that may negatively affect the world economy or oil demand," Nuaimi said.
Nuaimi said Riyadh was keen to "avoid any shortage of oil supplies in the world oil market, provide enough oil supply as needed and prevent soaring prices that may impact the growth of global economies, especially in developing countries."
"To achieve this goal, the kingdom began to increase its production more than three months ago to meet the growing demand for Saudi oil," he said.
"This increase amounted to more than one million barrels per day, bringing the average production of the kingdom during the past three months to more than 9.3 million barrels daily," he said.
"When the production of condensates and gas liquids is added, the production of Saudi crude averaged 10 million barrels daily."
Nuaimi also said that in September, "the total requirement of Saudi crude from oil companies for European, Asian and North American markets, along with domestic demand, is more than 9.3 million barrels daily, and it will be met in full, with no exclusions or reductions."
"The kingdom`s policy aims at meeting all demands of its customers from international oil companies," pledged Nuaimi.
Prior to Nuaimi`s declaration, world oil prices had continued their march upwards in trading earlier on Wednesday, shrugging off a warning by the International Energy Agency (IEA) that the market is showing "irrational exuberance".
But after his remarks, world oil prices plunged in volatile trading.
Brent North Sea crude oil for September fell 31 cents to 40.97 dollars per barrel in late trading in London.
New York`s light, sweet crude for September delivery slid 82 cents to 43.70 dollars in early deals, a day after surging to the record high level of 45.04 dollars.
The IEA estimated on Wednesday that OPEC, straining to increase production, is set to add 400,000 barrels per day of capacity this year and slightly more than 2.0 million bpd from 2005 to 2007.
The increase in prices came on Wednesday as major producer Iraq said exports of the country`s crude have halved following the closure of a southern pipeline earlier in the week because of the threat of attack.
Elsewhere, a top Russian energy official urged the justice ministry Wednesday to unfreeze the bank accounts of the country`s largest oil producer Yukos because its breakdown could see world oil prices soar.
Yukos, teetering on bankruptcy, announced that creditors had declared it in default of a 1.6 billion dollar loan.